What is truly going on with the DC area real estate market, please explain?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I’m new to the DMV. We don’t plan to stay longer than 5 years so we watch the market very closely to ensure we don’t over renovate, etc. Not to hijack this post, but can someone explain to me why homes in CCDC seem to sell at a higher cost per square foot than CCMD. They seem very similar. Or does it come down to being “walkable” to metro and/or the 4 shops on CT? Generally curious.

Having a D.C. address and zip code has better cachet. That's basically it. You see the same thing with Potomac DC versus Potomac MD and the only difference is a dividing invisible line.

Property taxes in D.C. are also substantially lower. We only pay a city tax. Maryland residents pay both county and state at higher rates.

Immediately next to CCDC in MD the houses and the lots are bigger.

Not too long ago, it was the opposite. However, MD keeps raising taxes so that taxes in DC are now lower. The schools CCDC are zoned to have also improved tremendously over the last 10-20 years (or at least the perception of them has) whereas people have become increasingly dissatisfied with MoCo school. Most people I know in CCMD send their kids to private.

[Anonymous]

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Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:So Goldman Asia is already at 50% capacity in offices when vaccines were just approved 30 days ago? Yeah. Okay. Let's see what happens by end of 2021 year.

In the memo, which was verified by a bank spokeswoman, Chief Executive Officer David Solomon said Goldman is also considering “the feasibility of testing (staff and visitors for the coronavirus), subject to availability and more information on the accuracy of results.”

Large banks worldwide have been developing plans to gradually return staff to offices after nearly two months of working remotely and from home during the outbreak of the novel coronavirus.

...did you read any links I posted? Am I arguing with a robot?! (Jokes on me, if so.) Goldman is at 2-3% today, and they plan to ramp up to 50% eventually, with the other 50% of their workforce permanently work from home.

Did you notice that article is 8 months old? If they were at 2% in June 2020 - why would it be the same in February 2021?

I don't work with Goldman but I work with another bank and their reopening efforts ran smack into the second and third waves of the virus. They are still at the same levels they were back then. Traders are fully remote and everybody seems happy so it's a major ? what will happen next. The CRE market has put a lot of pressure on the banks because it's an existential threat for them. The most bullish move is Amazon buying up huge amounts of space in NYC for their NY-HQ2 because they think young college grads will want to move there no matter what. Facebook has leased some but the other tech companies are not biting.

Thanks - this is interesting. NYU (in New York) and UCLA (in L.A.) also had the largest application season in their history for the 2020-2021 year. So I don't think the young college grads think is wrong. A 15% and 28% increase in applicants says something.

http://www.nyu.edu/about/news-publications/news/2015/january/record-breaking-60000-students-apply-to-nyu-largest-increase-in-15-years.html

https://abc7.com/ucla-admissions-applications-diversity/10142247/

I think it is going to push the young people to want to be in urban areas even more. Staying home with mom and dad in middle of nowhere or middle suburbia gets real old at 18, 20, 22.

The young people from higher wealth households are going to be flocking to cities. I think Amazon is ahead of the game and knows this. It’s very competitive to recruit and retain top talent in tech, etc...

Uh. This is nothing new.

[Anonymous]

Anonymous wrote:Demographics. There are now the successful millennials who are jumping into the market - often with help from very successful parents. So there are more buyers combined with fewer new builds due to the 2008 crash. Also we are becoming like Paris - the city center is where the elite live and the banlieue or suburbs are where poorer residents live. Just look at MoCo! What a difference 20 years makes - boomers leaving, immigrants from Northern Triangle taking their place.

Gotta admit that I had to look up what the Northern Triangle was, and you are correct about MoCo's demographics. It's not just Central Americans though. Tons of migrants from Brazil, Ethiopia, the Caribbean, China, Vietnam, and various parts of Africa.

There's a lot of net positives with this shift (great food, for one), but there are some net negatives too that the bongwater left will never admit (low skill, low wage and exploitable workforce, gang violence and crime).

You would think that D.C. home prices would steer more home buyers into MoCo, but that does not seem to be happening. I guess the school system is no longer an enticement to raise a family in Montgomery County, so young couples opt for the charter rodeo in D.C.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Demographics. There are now the successful millennials who are jumping into the market - often with help from very successful parents. So there are more buyers combined with fewer new builds due to the 2008 crash. Also we are becoming like Paris - the city center is where the elite live and the banlieue or suburbs are where poorer residents live. Just look at MoCo! What a difference 20 years makes - boomers leaving, immigrants from Northern Triangle taking their place.

Gotta admit that I had to look up what the Northern Triangle was, and you are correct about MoCo's demographics. It's not just Central Americans though. Tons of migrants from Brazil, Ethiopia, the Caribbean, China, Vietnam, and various parts of Africa.

There's a lot of net positives with this shift (great food, for one), but there are some net negatives too that the bongwater left will never admit (low skill, low wage and exploitable workforce, gang violence and crime).

You would think that D.C. home prices would steer more home buyers into MoCo, but that does not seem to be happening. I guess the school system is no longer an enticement to raise a family in Montgomery County, so young couples opt for the charter rodeo in D.C. [/quote]

Except when you go on the DC schools forum and all you see is talk about fleeing.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Demographics. There are now the successful millennials who are jumping into the market - often with help from very successful parents. So there are more buyers combined with fewer new builds due to the 2008 crash. Also we are becoming like Paris - the city center is where the elite live and the banlieue or suburbs are where poorer residents live. Just look at MoCo! What a difference 20 years makes - boomers leaving, immigrants from Northern Triangle taking their place.

Gotta admit that I had to look up what the Northern Triangle was, and you are correct about MoCo's demographics. It's not just Central Americans though. Tons of migrants from Brazil, Ethiopia, the Caribbean, China, Vietnam, and various parts of Africa.

There's a lot of net positives with this shift (great food, for one), but there are some net negatives too that the bongwater left will never admit (low skill, low wage and exploitable workforce, gang violence and crime).

You would think that D.C. home prices would steer more home buyers into MoCo, but that does not seem to be happening. I guess the school system is no longer an enticement to raise a family in Montgomery County, so young couples opt for the charter rodeo in D.C. [/quote]

Except when you go on the DC schools forum and all you see is talk about fleeing.

Expecting DCUM to be representative of anything is a fool's errand. The statistics clearly show that the DC student body is getting whiter, and the percentage categorized as disadvantaged is decreasing pretty quickly.

[Anonymous]

There is a demand in certain areas, and there is a lack of supply!
Imagine that! People who can afford private schools and expensive properties are looking to be in a more desirable neighborhood, which happens to be where other like-minded rich people live! Preferably next to Obamas!
How unusual!

[Anonymous]

There is also this happening in suburbs. People can't afford Potomac, MD mansions so, they aren't buying them. Hence those prices are...well I have no idea now, but 2 years ago they were not increasing and were actually going down.
But, in areas where houses are 500K, 600K prices and the demand increasing.
Lots more people can afford 650K but not 1M. And this started happening in the summer. My neighborhood could not sell his house that needed updating for 9 months. 2500 sqft. Sold for 530K which was over 80K under the first price. Fast forward a smaller, worse roadhouse sold for 45K over the asking price, for 650K.
Why? Because people can afford 650 instead of 550 easier than 1M.

[Anonymous]

Anonymous wrote:There is also this happening in suburbs. People can't afford Potomac, MD mansions so, they aren't buying them. Hence those prices are...well I have no idea now, but 2 years ago they were not increasing and were actually going down.
But, in areas where houses are 500K, 600K prices and the demand increasing.
Lots more people can afford 650K but not 1M. And this started happening in the summer. My neighborhood could not sell his house that needed updating for 9 months. 2500 sqft. Sold for 530K which was over 80K under the first price. Fast forward a smaller, worse roadhouse sold for 45K over the asking price, for 650K.
Why? Because people can afford 650 instead of 550 easier than 1M.

Maybe because the previous owner was Patrick Swayze?

[Anonymous]

Seeing a lot of divergence in the future prospects of Northern Virginia and Southern Maryland.

[Anonymous]

In my older neighborhood in Ashburn we have original owners whose kids flew the nest years ago, and we have families with very young children. And everyone in between. What I’m seeing in my neighborhood is that people aren’t selling when the kids go to college, and people aren’t selling when they retire. I don’t know anyone in my community (and I’ve been here 20 years and know a ton of people) who are planning on selling in the next ten or more years.

There are only two houses on my street that have turned over since the pandemic started. One was a divorce and it sold before it actually hit the market (by a Coming Soon sign) at high dollar. The other went $35k over asking in two days. Those people left because they needed a bigger house due to parent moving in. Aside from dire circumstances no one wants to leave. I’m sure it’s like this all over the region.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I’m new to the DMV. We don’t plan to stay longer than 5 years so we watch the market very closely to ensure we don’t over renovate, etc. Not to hijack this post, but can someone explain to me why homes in CCDC seem to sell at a higher cost per square foot than CCMD. They seem very similar. Or does it come down to being “walkable” to metro and/or the 4 shops on CT? Generally curious.

Having a D.C. address and zip code has better cachet. That's basically it. You see the same thing with Potomac DC versus Potomac MD and the only difference is a dividing invisible line.

Property taxes in D.C. are also substantially lower. We only pay a city tax. Maryland residents pay both county and state at higher rates.

Where is Potomac, DC?

Sorry I was talking about Potomac Heights - also known as the Palisades. Homes start at $2M and the equivalent just across the border in MD is $1.5M.

https://www.redfin.com/DC/Washington/5240-Macomb-St-NW-20016/home/9943300

https://www.redfin.com/MD/Bethesda/4101-Maryland-Ave-20816/home/10640029

I have lived here since 1972 and have never heard Palisades referred to as "Potomac Heights" - please don't try to make that a thing. there is no correlation between Palisades and Potomac.

[Anonymous]

Anonymous wrote:

Anonymous wrote:There is also this happening in suburbs. People can't afford Potomac, MD mansions so, they aren't buying them. Hence those prices are...well I have no idea now, but 2 years ago they were not increasing and were actually going down.
But, in areas where houses are 500K, 600K prices and the demand increasing.
Lots more people can afford 650K but not 1M. And this started happening in the summer. My neighborhood could not sell his house that needed updating for 9 months. 2500 sqft. Sold for 530K which was over 80K under the first price. Fast forward a smaller, worse roadhouse sold for 45K over the asking price, for 650K.
Why? Because people can afford 650 instead of 550 easier than 1M.

Maybe because the previous owner was Patrick Swayze?

Actually so funny! Kind of proud of myself for that mistake! DH is a major Roadhouse and Swayze nut case!
I tell him Swayze was a ballerina....

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:There is also this happening in suburbs. People can't afford Potomac, MD mansions so, they aren't buying them. Hence those prices are...well I have no idea now, but 2 years ago they were not increasing and were actually going down.
But, in areas where houses are 500K, 600K prices and the demand increasing.
Lots more people can afford 650K but not 1M. And this started happening in the summer. My neighborhood could not sell his house that needed updating for 9 months. 2500 sqft. Sold for 530K which was over 80K under the first price. Fast forward a smaller, worse roadhouse sold for 45K over the asking price, for 650K.
Why? Because people can afford 650 instead of 550 easier than 1M.

Maybe because the previous owner was Patrick Swayze?

Actually so funny! Kind of proud of myself for that mistake! DH is a major Roadhouse and Swayze nut case!
I tell him Swayze was a ballerina....

Love that movie.

[Anonymous]

Anonymous wrote:You would think that D.C. home prices would steer more home buyers into MoCo, but that does not seem to be happening.

Maybe I’m an anomaly, but when I bought 6 months ago, DC was not only cheaper but also less competitive than the areas I was fruitlessly touring and bidding within in MoCo. MoCo has gone off the rails. I wonder how many pandemic buyers will regret choosing MoCo over DC once this blows over.

[Anonymous]

Anonymous wrote:

Anonymous wrote:You would think that D.C. home prices would steer more home buyers into MoCo, but that does not seem to be happening.

Maybe I’m an anomaly, but when I bought 6 months ago, DC was not only cheaper but also less competitive than the areas I was fruitlessly touring and bidding within in MoCo. MoCo has gone off the rails. I wonder how many pandemic buyers will regret choosing MoCo over DC once this blows over.

None